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2017 NYS Recycling Conference

Lisa A. Skumatz, Ph.D.

Skumatz Economic Research Associates, Inc. (SERA)

November 8, 2017 skumatz@serainc.com

© SERA2017, All Rights reserved May be used with permission of author

PAYT: WHAT’S HOT IN MATERIALS MANAGEMENT’S IMPACT ON CLIMATE CHANGE?

SERA

WHAT WORKS IN MOVING THE NEEDLE ON CLIMATE CHANGE? o  Get more from existing programs

n  More for same $; Same for lower $ o  Impacts and cost-effectiveness

n  Variety of options n  What we can impact now

o  Smart choices for next – GHG results – SERA work shows PAYT is most cost-effective GHG strategy (showed $/MTCE and Job creation)

How planning to reach NY state goals?

SERA

PROGRAM EVOLUTION Drop-offs, voluntary added fee recycling, education

Embedded recycling, MF and commercial ed. / assistance, expanded D/O

PAYT with embedded rates, yard waste, commercial programs , continued ed.

Add Res Food scraps., mandates / bans, address MF recycling, hauler incentives, PAYT+

Every-other-week MSW, mandatory commercial and MF, EPR, zero waste

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20- 45%

40% +

0 - 15% Diversion

10 – 25%

50% +

Education Crosses All Levels

Source: Skumatz Economic Research Associates, all rights reserved

SERA

EFFICIENT, EFFECTIVE OPTIONS FOR STEPPING IT UP NOW

High Diversion Impact

Savings / C/E

Residential: Pay As You Throw (PAYT) enhancements,

√ √

Commercial: barriers, PAYT, new delivery

√ √

Incentives / taxes, mandates / bans √ √

Education ? ?

Measuring to goal √ √

Source: Skumatz Economic Research Associates, Inc. analysis

SERA

PAYT - EFFECTIVE AND COST-EFFECTIVE o  Effectiveness:

n  Biggest impact* o  DOUBLES recycling o  Diverts ~1/5-1/6 from

landfill o  Curbside & D/O impacts

n  R, YW, SR; cost-effective n  No cost increase for 2/3 n  Top driver in leading states

o  Goals/metrics, $, PAYT n  Best performer

o  Concerns: n  Strengths &

weaknesses-political will

n  Haulers – link to contracting

n  Haulers – other ways of implementing

o  Considerations: n  Known BMPs n  Com’l PAYT

5 Source for graphs and figures: Skumatz Economic Research Associates,© Source for “top 3 drivers, Skumatz & Freeman / SERA, “Colorado Roadmap Report, 2008.

SERA

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PAYT - EFFECTIVE & COST-EFFECTIVE

o  Cost-effective: n  1/3 of the effect costs ZERO (SR) n  PAYT needs NO SEPARATE FUNDING –

paid by users (more equitably) n  No increase in costs for 2/3 communities (IA, WI)* n  Cheap for reduction of both GHG and Landfills

o  HH preference o  Performs better than credits or RB

Source for graphs and figures: Skumatz Economic Research Associates ©

012345678910

Landfill YW Recy

Job/10KTons

Jobs/10K Tons Source: ILSR

0

1

2

3

4

5

Relative$/MTCO2E Relative Jobs/$1

*Iowa survey by Frable

Source: SERA

SERA

PAYT MORE TONS, LESS COST THAN OTHER INCENTIVE OPTIONS (RecycleBank)

$0

$20

$40

$60

PAYT RecycleBank™

n  Incentives for recycling ONLY – <1/3 of PAYT’s impact n  RecycleBank™ incentive (also towns & haulers)

o  Towns considering because: Hauler partnerships, “turnkey”, jumpstart stalled recycling, no new billing (HOAs like it), strong marketing; having trouble getting recycling or PAYT in place… other

o  Impacts – tons BEYOND single stream / containers; fees; rebates; cost per ton; redemptions

o  See if it pencils out… can have both as well… n  Study “MATH”, outcomes & “deals” for other options…

Town Tons and HH Savings/Yr

Source: First graph from figures from EPA newsletter, 2009; 2nd graph from Skumatz study.

1500 TPY 1000 TPY 500 TPY 0 TPY

SERA

PAY-AS-YOU-THROW / SAYT / RECYCLE & $AVE

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SERA

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FOUR MAIN TYPES OF PAYT SYSTEMS

•  Carts by size – strong and growing, works best with automated,

•  Bags or Tags by Number (with/without base fee)

•  Hybrid •  By Weight •  Drop-offs All but last in place around US Each has pros / cons

SERA

PAYT PROS / CONS

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Key Advantages Disadvantages Rewards all diversion activities No new trucks down street (&wear/tear) Behavior / reminder; choice Utility; equity Works in variety of systems, tailor NEEDS NO SEPARATE FUNDING! – OWN FUNDING SOURCE - JUST A DIFFERENT WAY OF BILLING

Concerns about illegal dumping, equity (low income, large families), MF (see FAQs), change… More complex rate study, outreach Hauler concerns (alternate implemenation methods) Costs & savings - “Net” depends on local conditions

Source: SERA ©2008; Iowa State Survey by Frable.

SERA

PAYT BEST PRACTICES

To get best effects, there are key elements of design. •  Recycling available / embedded best •  Optimal incentive levels (containers & $) •  Small containers available •  Parallel containerization •  Education / information •  Clear bill & reporting •  Enforcement / Level playing field … (or it isn’t worth it) There are currently “tons left on the table!”

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SERA

OPTIMAL PAYT RATE DIFFERENTIALS?

o  Not too high… o  Not too low…

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o  Biggest cost is getting truck to the door… o  Covering costs an issue… - what if you’re too

successful!? o  SERA Statistical work studied diversion

performance vs. rate diffs.

SERA

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EVEN IN CALIFORNIA – TONS LEFT ON THE TABLE! (work for EPA)

Source: Econservation Institute and SERA

MISSED OPPORTUNITIES TO INCREASE DIVERSION / TONS BEING LEFT BEHIND!!

SERA

PAYT LEGISLATION

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Oregon Rate structure per average weight Requires mini can Multi-unit pricing

Washington Incentives for source separation Establishes recycling, could include organics

Minnesota Rates based on volume or weight

Weight – Unit sizing Mult-unit pricing

SERA

PAYT LEGISLATION

New Vermont Legislation

Increased diversion Multi Stream PAYT Definition Compliance

SERA

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MAIN WAYS TO GET PAYT IN PLACE

o Ordinance n  If multiple haulers servicing area and want

minimal disruption in service providers o Contracting / districting / franchising

n  If multiple haulers servicing area and want economies of scale, single provider

o Municipalization n  Do it yourself, local decision-making, local

action

SERA

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GETTING PAYT IN PLACE: ORDINANCE VS. CONTRACT -COMMUNITY PERSPECTIVE Ordinance Pros Contract Pros (similar for munic)

q  Fewer Hauler (“Taking”) & Citizen Complaints (“Choice”)

q  Maintains competition q  No need for “notice” q  Quick q  Can specify rate “structure” q  Minimal City effort (RFP, etc.) q  Retains “level playing field” for

haulers – each implements the program and provides services knowing others will be operating under same rules.

q  Lower Cost / bills q  Fewer trucks, “cleaner” set outs,

reduced wear/tear on streets q  One hauler to contact if problems

arise. q  City “control” including rates/

setting; revenues q  More flexible / easier to enforce

penalties than ordinance q  Can “designate” facility

destinations for materials q  Potential revenue source q  (Similar for franchise / district

EXCEPT may not get lower bills if multiple awardees)

Sample language available for State legislation, contracts, ordinances, etc.at www.paytnow.org; paytwest.org; www.paytinfo.org

Source: SERA publications

SERA

PROBLEMS: FEARS GREATER THAN REALITY

Solvable… see faqs

Fear Reality Illegal dumping Minimal / low, short-lived –have BULKY option

Confusion, resistance to change

Continuing education (prior, free stickers)

Non-compliance Minimal

Contamination Minimal

Burning Banned (60%, illegal, seasonal, warn once then remove, charge more)

Self-haul and by-pass Base fee, mandatory (impacts on rates and setouts)

Revenues (esp. haulers) Less volatile systems, work with haulers in design, pilot

Private/multiple haulers Multiple colors, work with haulers

Local and regional economics

Depends on markets, LF ownership, processing, cost structure, prices

SERA

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BUT WHAT ABOUT… o  HOAs? o  MF? o  Commercial?

SERA

COMMERCIAL PAYT o  Like MF, Commercial is a volume

based system o  Bag programs exist (as does weight)

but very rare in the US o  Key is recycling embedded in trash

rate (50-150%, min opts too)

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SERA

KEY COMMERCIAL STRATEGIES o  #1 PAYT

n  Mandate recycling cost embedded in trash fee (50%-150% of trash size)

n  Organics embedded n  Small commercial n  Eliminates barrier of ‘recycling adds

avoidable cost’ n  Space / screening issues

SERA

COMMERCIAL PAYT – EMBEDDED (BEST ELEMENTS) o  Embedded – NO extra fee, no exceptions o  Specific size geared to goal plus minimum

n  Same size=50% recycling; 75% recycling needs 150% size recycling;

o  Supporting elements n  Clear materials – recycling and/or organics n  Convenience n  Education

o  Enforcement n  Plan, inspection / drive by, other n  Leery of hauler responsibility

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SERA

COMMERCIAL STRATEGY & IMPLEMENTATION PHASES Phase 1. Community prep, research, goals, ID authority

Phase 2. Hauler / business info & goals, Ordinances

Phase 3. Business incentives, technical assistance, recognition

Phase 4. Partnerships for programs & facilities; small business attention

Phase 5. Bans, mandates, targeted streams or sectors; requirements & enforcement

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Town cost

No cost, no tons

Some tons, authority

Strong tons; town costs

Phase 6. Policies, contracting, markets and facility development; framework for “net zero”

Adapted from SERA 2013

More investment

SERA

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HUNDREDS OF RESIDENTIAL CASE STUDIES o  Ordinance o  Contract o  Rural options o  State requirements

o  Some of my best case studies are coming next!!

SERA

CASE STUDY: FORT COLLINS o  One of earliest in Colorado o  Multiple haulers o  Require haulers to charge via PAYT

n  Early years allowed “base fee” n  Later 100% differential for all n  Now undergoing revisions as part of URO

o  High performing community – strong recycling and diversion

SERA

CHALLENGE HIGHLIGHT: Refuse carts

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•  Elderly concerned about maneuvering

•  Brochure picture

SERA

CASE STUDY: VAIL – “ORDINANCE” o  Resort community

located in Central Mountains of CO

o  Population of 5K year round, swells to about 45K during peak times, 335” of snow a year

o  Open-hauler system o  Low recycling rate for a

number of reasons

SERA

RATES vs. BILLS/ ACCEPTABILITY o  Highlight winners (and

losers) -- % and $ o  Rates vs. BILLS

For example:

70% pay same or less! (vs. $/can increased) (but note here, average bill increased $0.80 -- outcome depends on structure, changes)

+ +

LAST YEAR Unlimited

service= $18.00/hh/mo

1 can plus recy =$10/hh/mo SAVE $5.00! 3 cans=$26/hh/mo

PAY $8 more/mo!

2 cans plus recycling= $18/hh/mo

30% 50% 20%

NEW OPTIONS

HIGHLIGHT BEHAVIORAL POTENTIAL, not rate comparison

SERA

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CASE STUDIES – FLEXIBILITY IN PAYT

•  Work in Large, small, urban, suburban, rural •  Multiple program types •  Multiple ways to implement •  Lessons availabale – case studies on line

SERA

Q&A o  Types? – appropriate for your town? o  Rate Differentials? o  Key best practices? o  Hauler issues? o  Contract vs. ordinance? (contracting tips) o  Resonate with your council? o  Soon / longer term? o  Other recall? o  How planning on meeting NY Goal?

SERA

PAYT SUMMARY o  PAYT effective, cost-effective, flexible,

demonstrated n  Flexibility in design and implmentation n  Negatives manageable with political will (and possible

renaming to get past “pay”!)

o  Quickest, least expensive, most effective approach to achieve diversion, equity, and environmental goals

o  Don’t forget commercial o  BEST WAY FOR NY TO GET TO GOALS

(STATEWIDE PAYT LAW?) o  Resources available to all (paytnow.org)

n  Go to www.paytnow.org or call 303/494-1178

SERA

QUESTIONS / ASSISTANCE:

Lisa A. Skumatz, Ph.D. Skumatz Economic Research Associates (SERA) 762 Eldorado Drive, Superior, CO 80027 Phone: 866-758-6289, 303/494-1178 email: skumatz@serainc.com

Free assistance & Websites – www.paytnow.org, paytwest.org, paytinfo.org